Thursday, September 27, 2018

With the government imposing customs duty on aviation turbine fuel, airlines are likely to pass on higher costs to passengers as peak travel season is round the corner.

Rising fuel prices, intense competition and inability to pass on spiralling expenses have been negatively impacting the domestic airlines. The latest decision to impose 5 per cent customs duty on ATF, which is a major component of an airline's operational costs, would add to the woes, according to experts.

In recent weeks, airline industry has indicated that air ticket prices could go up in October when the peak travel season begins.

Travel portal Yatra.Com's COO (B2C) Sharat Dhall said the imposition of 5 per cent customs duty on ATF is bound to have a "negative impact" on the carriers.

"However, the silver lining to the situation is that with the peak season kicking in, we are likely to see increase in prices and strong loads as well. This would provide relief to the airlines," Dhall said.
27/09/18 PTI/ZeeBiz